I'm an associate editor at Forbes, part of the team responsible for our signature issues: The Forbes 400, Global Billionaires and America's Richest Families. As a writer, I cover these wealthy business builders as well as other entrepreneurs. Before Forbes, I also reported on entrepreneurs for Inc. magazine and attended Syracuse University's S.I. Newhouse School of Public Communications.

Sprint's Problems, Brought Into New Clarity, Fall To Billionaire-Led SoftBank To Solve

President of Japan's mobile carrier Softbank Masayoshi Son (L) shakes hands with the CEO of the third largest mobile carrier in the US, Sprint Nextel's Dan Hesse (R), as they announced Softbank will acquire Sprint Nextel in Tokyo. (Image credit: AFP/Getty Images via @daylife)

Sprint’s quarterly loss widened in the latest period, and the mobile carrier continued to see a customer exodus, heightening expectations for the transformation under Japan’s billionaire-led SoftBank, the new majority owner.

As Sprint worked to finish its expensive shutdown of its Nextel network, the company posted a second-quarter loss of $1.6 billion, 53 cents a share, compared to $1.4 billion, 46 cents a share, last year. Excluding one-time items related to Nextel, the loss was 31 cents a share. Analysts predicted Sprint would lose 30 cents a share.

Additional evidence of Sprint’s problems can be found in the more than 1 million contract customers that left Sprint in the quarter, bringing its total subscriber base down to 53.6 million at the end of June from 55.2 million a quarter earlier. The customer flight was worse than analysts expected, who forecast Sprint would lose 972,000 customers. The Sprint-branded service added 194,000 customers, though it would’ve actually seen a decline in customers if 364,000 Nextel users hadn’t shifted from the defunct network.

Revenue was virtually flat at $8.87 billion, from $8.84 billion a year earlier, matching Wall Street‘s estimate. Average revenue per subscriber increased to $64.20, from $63.38 a year earlier, with subscribers paying more for data services.

Verizon and AT&T have left Sprint, the nation’s third largest mobile carrier, as an also-ran in recent years. Part of the blame can fall on Sprint’s decision to spend $35 billion on the 2005 merger with Nextel, a tie-up that forced Sprint to deal with the high costs of maintaining two networks. At the same time, T-Mobile has inched slowly closer to Sprint, becoming increasingly competitive with its larger peer by offering cheaper pricing plans–and now AppleApple‘s iPhone. Now, the latest quarterly results, weakened by the Nextel close-down and increasing customer defection, brings Sprint’s situation into sharp relief.

Going forward, Sprint will look to its new majority owner, SoftBank, for answers and direction. SoftBank is run by a maverick CEO, Masayoshi Son, who aggressively built his telecom company into a giant in Japan before turning his attention to overseas growth. To win Sprint, Son went head-to-head with Dish Network’s billionaire chairman Charlie Ergen. Son emerged victorious, paying $21.6 billion for 78% of Sprint. The deal closed July 10.

SoftBank has already recapitalized Sprint, giving it a $5 billion cash infusion to improve its network. Sprint this morning says the network makeover, which it calls Network Vision, is on track. What’s more, SoftBank allowed Sprint to buy the remaining stake in Clearwire Corp. that it didn’t already own, gaining additional spectrum that will allow it to increase broadband speed and its network capacity.

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Bought a “4g phone” that used WiMax a year and half ago and it is complete garbage. Can never get a 4g signal and even though 3g was supposed to have been well established it, it’s worst that MetroPcs 2g. No amount of “PRL” updates will improve a horrid network. Come February, I will be adding to the number of people on an “exodus” from Sprint.

Since switching, I never needed a PRL update on AT&T. AT&T must have better technology, and they don’t sell a device that doesn’t need a PRL update every week. They just work out-of-the box.

PRL updates gave me the illusion of some sort of service. I’m not sure what. I later learned, a PRL reprogramming just instructs the phone which network it can connect to. But if an antenna isn’t nearby, a PRL update doesn’t magically make coverage appear.

To add to this, BestBuy wouldn’t allow me to return the brick after having it for a few weeks. They checked the call timers and said I used the phone, and it couldn’t be exchanged or refund the purchase. Six months later, they said they don’t sell the phone anymore.

What an experience! It became a very expensive service, that worked only in the office, next to my desk phone.

Still, there is some good news– According to a SoftBank presentation, Sprint is experiencing growth- customers are seeing their bills increase up to 7% per annum, which is leading the industry. This means that Sprint Customers bills are going up in price.

My guess is that Sprint’s PRL updates are costing the company 7% additional in overhead. Getting stuck with a phone I bought at BestBuy and couldn’t exchange was worse!

I don’t own any stock in any telecom company, and if I did, it certainly wouldn’t be Sprint! I’m glad I’m out of my contract. AT&T is pretty expensive, but my son recently signed up with a T-Mobile plan, and it works well at home. I may ask to borrow his phone for a few days prior to the AT&T contract renews. I’d like to see if it works at my office.

PRL stands for Preferred Roaming List. What it does is update the list of ROAMING partners, towers, and networks the device can connect to. Often, it is used as a tool to DELETE certain towers and networks when your own carrier feels they offer good enough service in that particular area, or when costs are too high to roam and the agreement ends.

It DOES NOT help to increase, add towers to, or modify any of the Sprint network capability to your own device. Those towers and sites are set within a network code, the device already is preprogrammed with this code, to work on Sprint. Adding towers on Sprint wont change the code, and your device will automatically detect and pick up the code on any new towers and sites. Its built into the system.

AT&T and T-Mobile establish this list, and maintain it on your SIM. Except instead of updating individual towers like PRL does for roaming, GSM carriers do it by network regional code.

If Sprint is telling you to update the PRL, they are full of it. They should be telling you their network truth, that it does not work, they have capacity issues, they have no intent of actually fixing the problem, only resetting your phone to connect to the tower as a new user in hopes the cards at the tower free up by that time to allow you to connect for longer periods with less downtime happen – I know all too well this is not the case.

I am on the Sprint Network and I really don’t have a problem with my service but my biggest problem with Sprint is how they treat there existing customers. When the new S4 came out, the existing customers had to pay $250 for the phone while new customers only had to pay $150. I am all for enticing new customers to switch carriers to gain new business –that’s the way business works. But bad business is when your existing customers have to pay over $100 dollars for the same phone everyone else has. All other carriers were charging less than Sprint when the new S4 came out. I am not suprised that they lost so many customers.

I have been a Sprint customer for 13 years. Service has become worse and no 4G. What do they sell 4g phobes for? They say they are upgrading that is why I have daily dropped calls, slow data speeds, etc. However, they hve been saying this for 5 years. When they approach date for upgrading network, they keep extending the date. It never ends. Truly poor planning, Sprint! Cannot wait until my contract ends. Verizon, here I come.